Alternative Investments

Alternative investments is a fairly broad term for any investible asset that falls outside the traditional asset classes of equities, bonds, property and cash. It can include works of art, antiques or even wine.

More importantly, it includes specialist investment styles and financial assets such as hedge funds or private equity.

Alternative investments are frequently portrayed as risky. Their complexity is sometimes interpreted as lack of transparency. This does not make them particularly 'dangerous', but it suggests extra care when conducting research and due diligence of such investments.

Alternative investments should be considered useful for managing risk and smoothing the returns of a diversified portfolio. It would be unusual to find a portfolio which was composed entirely of alternative investments.

The alternative investments industry is relatively young when compared to mainstream markets such as equities and bonds. However developments in the industry and regulatory pressures have made these investments more accessible.

Coutts has been an active user of alternative investments for many years. We consider it a positive development that these investments have become increasingly established among a wider audience. We are embracing the trends of recent years that are improving access for investors. These include:

Transparency - providing investors with more information on the charges on their investment and the factors that influence returns

Liquidity - so that investors can cash in their investment faster and easier if needed

New product formats - such as Undertakings for Collective Investment in Transferable Securities (UCITS) which are increasingly used by the alternative investment industry.

Coutts has market-leading expertise and experience in using alternative investments. We offer our clients a range of hedge fund investments and, from time to time, other alternative investment opportunities. We are happy to discuss these investments and their suitability with you.